Commissioner Of Income Tax Delhi ... vs Compro Technologies Pvt.Ltd.
2014 Latest Caselaw 6610 Del

$~20.


*       IN THE HIGH COURT OF DELHI AT NEW DELHI
+              INCOME TAX APPEAL NO. 744/2014
                                      Date of decision: 9th December, 2014
        COMMISSIONER OF INCOME TAX DELHI -2.                 .... Appellant
                          Through Mr. Rohit Madan, Advocate.

                          versus

        COMPRO TECHNOLOGIES PVT.LTD.                       ..... Respondent
                    Through Nemo.

        CORAM:
        HON'BLE MR. JUSTICE SANJIV KHANNA
        HON'BLE MR. JUSTICE V. KAMESWAR RAO

SANJIV KHANNA, J. (ORAL):

        This appeal by the Revenue challenges the order of the Income Tax

Appellate Tribunal (Tribunal, for short) deleting penalty under Section

271(1)(c) of the Income Tax Act, 1961 (Act, for short). The appeal

pertains to Assessment Year 2009-10.

2.      The finding of the Tribunal is that the assessee had discharged the

onus and established their bona fides for the purpose of Explanation 1 to

Section 271(1)(c) of the Act.         The Chartered Accountant of the

respondent-assessee had filed his own personal affidavit accepting his

fault that he had misunderstood and misinterpreted the provisions of

Section 115JB of the Act. Computation of book profits under Section



ITA 744/2014                                                        Page 1 of 3
 115JB requires skill and knowledge of accounts. The Act mandates and

requires an assessee to file Form No. 29B from a Chartered Accountant.

The computation made by the Chartered Accountant in this case in Form

No. 29B was erroneous and he had owned his fault and mistake. This was

the first year when Section 115JB was made applicable to companies

covered by Section 10A of the Act.         Thus, the explanation of the

Chartered Accountant, who made an error in calculating book profits with

reference to exempt income under Section 10A of the Act. Complexity

had arisen due to interplay of Section 115JB with Section 10A of the Act.

3.      On considering the factual matrix, the Tribunal has observed that

the explanation and conduct did not reflect any attempt to propound an

excuse which was sham or a ruse. The reason given was not a device to

cover an ulterior purpose. The mistake made by the Chartered Accountant

was a result of a human error in correctly interpreting and applying the

complex interconnect between two sections. The error was bona fide.

Noticeably, the assessee had realised their fault and had filed revised

returns for the subsequent years.

4.      The view and reasoning given by the Tribunal is plausible and

objective. They have rightly relied on the findings and ratio in Price

Waterhouse Coopers Private Limited versus CIT, (2012) 348 ITR 306

(SC). Keeping in view the findings recorded by the Tribunal, we do not



ITA 744/2014                                                      Page 2 of 3
 think any substantial question of law arises for consideration. The appeal

is accordingly dismissed.


                                      SANJIV KHANNA, J.

V. KAMESWAR RAO, J. DECEMBER 09, 2014 VKR